REG - Cizzle Biotechnology - Licensing and Partnership MoU for North America

Cizzle Biotechnology HoldingsAnnouncement

02/04/2024 07:00

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RNS Number : 8949I  Cizzle Biotechnology Holdings PLC  02 April 2024

2 April 2024

Cizzle Biotechnology Holdings plc

 

("Cizzle", "Cizzle Biotechnology", or "the Company")

 

Strategic Licensing and Partnership Memorandum of Understanding for North
America

Cizzle Biotechnology, the UK based diagnostics developer, is pleased to
announce that it has signed a non-binding Memorandum of Understanding ("MoU")
for a strategic and exclusive licensing agreement to develop and offer its
proprietary test for the CIZ1B biomarker which is highly associated with
early-stage lung cancer, throughout the USA and Canada ("North America").

 

The new partnership is intended to incorporate the Company's existing
relationship with Corepath Laboratories, a full-service cancer reference
laboratory, as announced on 6 May 2022, through a dedicated, recently
incorporated, US based company Cizzle Bio Inc ("BIO").  As set out below, and
subject to binding documentation, the proposed royalty arrangements with
CorePath will be restructured to enable the Company to gain significant cash
flows from new royalty payments and significant cost savings.  All planned
expenditure related to clinical trials and the commercialization of diagnostic
tests for the CIZ1B biomarker in the USA are expected to be funded directly by
BIO.  In addition, the Company will benefit from the free issue of shares in
BIO.  BIO is paying a non-refundable upfront fee of US$100,000 within 30 days
of signing the MoU for a 120-day exclusivity period to complete the formal
legally binding agreement.

 

Key Highlights

 

·    The MoU envisages Cizzle providing an exclusive licence to BIO to
develop and market clinical diagnostic assays based on the CIZ1B biomarker to
facilitate the early detection of lung cancer in North America

·    Cizzle will receive an up-front payment of US$100,000 within 30 days
as a non-refundable fee to grant BIO an exclusive negotiating period of 120
days

·    Subject to entering binding documentation, Cizzle will receive
minimum advance royalty payments of US$2.3 million over a period of 30 months,
payable as to US$0.3 million on signing the binding agreement and a further
US$1.0 million on each of the fifteenth and thirtieth ( )month anniversaries
of signing as part of annual royalty fees of 10% of net sales

·    BIO intends to fully fund all expenditure on development, clinical
trials, accreditation and marketing of diagnostic tests for the CIZ1B
Biomarker in North America which would represent a significant saving on
current planned expenditure by the Company

·    Cizzle will participate in the ownership of BIO through a grant of a
10% equity stake in BIO for no cash consideration

·    Cizzle will benefit from inventions and improvements to CIZ1B
technology for sale in the rest of the world

 

Further Information

Cizzle's vision is to meet the challenges of early lung cancer detection,
reduce premature cancer deaths, improve survival rates and increase quality of
life for cancer patients by helping detect cancer as early as possible through
a simple blood test.

On 26 March 2024, the Company completed a placing raising gross proceeds of
£620,000, which will be utilised towards completing Cizzle's first proposed
commercial test to detect CIZ1B, further protect its Intellectual Property
(IP), progress the Company's research with the University of York and for
general corporate purposes.  Key expected future milestones are the
manufacturing and scale up of key antibodies and reagents, that following
performance testing in clinical trials are intended to become the core
components of the Company's commercial test for the CIZ1B biomarker.

 

It is intended that the clinical trials and first commercial tests will be
launched in the USA, in part because lung cancer is by far the leading cause
of cancer death there and the US Preventive Services Task Force guidelines now
recommends screening for 14.2 million at-risk adults*.  With current take up
of lung cancer screening tests at less than 10% of the at-risk population, the
unmet need is for a simple blood test such as that being developed by Cizzle
for the CIZ1B Biomarker.

 

The Company believes that as we enter this pivotal phase to accelerate the
development, regulatory approval and launch of its biomarker diagnostic tests
in North America the establishment of an independently financed and locally
managed business is the appropriate route to take.  BIO will be able to focus
on bringing the Company's technology to market through building close
relationships with key hospitals and clinical cancer centres and bringing
together key opinion leaders and clinicians to drive adoption in this
important market.

 

BIO will be led by Bill Behnke, who was appointed by the Company on 16 June
2022, to identify and facilitate growth within the USA through his network in
the clinical and healthcare industry.  He was responsible for putting in
place Cizzle's co-operation with CorePath Laboratories.  Through BIO, the
Company will benefit from working closely with CorePath's  College of
American Pathologists (CAP) and Clinical Laboratory Improvement Amendments
(CLIA) accredited specialist oncology reference laboratory in San Antonio,
Texas, which brings together leading clinicians, scientists, academic
affiliates and state of the art facilities.

 

Mr Behnke will be joined on the Board of BIO by Dr Ron Greeno, a veteran
physician executive with 30 years of experience in the hospitalist practice
management field.  He was the founder of Cogent Healthcare and served as its
EVP for strategy and Chief Medical Officer until its merger with Sound
Physicians.  He has also served in physician executive positions at IPC and
TeamHealth.  He was board certified in internal medicine, pulmonary medicine
and critical care.  He has been a senior advisor for government relations
with the Center for Medicare and Medicaid Innovation ("CMMI"), also known as
the 'Innovation Center', which was authorised under the Affordable Care Act
and tasked with designing, implementing, and testing new health care payment
models to address growing concerns about rising costs, quality of care, and
inefficient spending.  CMMI is managed by the Centers for Medicare and
Medicaid Services (CMS).

 

BIO's ability to meet its financial obligations is dependant on a group of
sophisticated high net worth investors in the USA.  BIO intends to fully fund
all expenditure on development, clinical trials, accreditation and marketing
of diagnostic tests for the CIZ1B Biomarker, resulting in a free carry for the
Company through to commercialization in North America.  The Company will
retain rights to improvements and inventions resulting from this
commercialization process in the rest of the world.

 

The Company is now focused on finalising binding legal documentation with BIO
and will make further announcements in due course, as appropriate.

 

Allan Syms, Executive Chairman of Cizzle Biotechnology, said:

 

"We are delighted to have entered into this Memorandum of Understanding to
create an independently financed and locally managed company that can build a
business to serve the North American market.  Apart from securing important
guaranteed minimum and ongoing licensing revenue and free equity participation
for the Company, there will be a significant reduction on planned costs
associated with clinical trials and product accreditation.  This represents a
substantial opportunity to expand the Company's presence in North America
through securing non-dilutive major investment and in building a high value
dedicated US based leadership team to establish operations and drive adoption
in this important market."

 

Bill Behnke, CEO of BIO, commented:

"Lung cancer is the leading cause of cancer deaths in the USA because of the
unmet need for a simple blood test to aid physicians in the early detection of
cancer.  Through a strong appreciation of the potential value of the CIZ1B
biomarker in improving patient survival rates we are very excited by the
opportunity to secure an exclusive license from Cizzle for the North American
market.  Our investor group sees this as an important opportunity to make a
major difference to lung cancer survival rates and we have already made
progress in developing further relationships with major cancer hospitals as we
seek endorsement from clinicians and key opinion leaders."

 

*The 2021 USPSTF lung cancer screening guidelines: a new frontier - The Lancet
Respiratory Medicine
(https://www.thelancet.com/pdfs/journals/lanres/PIIS2213-2600(21)00210-1.pdf)

 

Enquiries:

 

 Cizzle Biotechnology Holdings plc  Via IFC Advisory
 Allan Syms (Executive Chairman)

 

 Allenby Capital Limited  +44(0) 20 3328 5656
 John Depasquale
 George Payne

 

 Novum Securities Limited  +44(0) 20 7399 9400
 Colin Rowbury

 Jon Bellis

 

 IFC Advisory Limited  +44(0) 20 3934 6630
 Tim Metcalfe
 Florence Chandler

 

About Cizzle Biotechnology

Cizzle is developing a blood test for the early detection of lung cancer. The
Company is a spin- out from the University of York, founded in 2006, around
the work of Professor Coverley and colleagues. Its proof-of-concept prototype
test is based on the ability to detect a stable plasma biomarker, a variant of
CIZ1 known as CIZ1B. CIZ1 is a naturally occurring cell nuclear protein
involved in DNA replication, and the targeted CIZ1B variant is highly
correlated with early-stage lung cancer. For more information, please see
https://cizzlebiotechnology.com (https://cizzlebiotechnology.com)

You can also follow the Company through its twitter account @CizzlePlc and on
LinkedIn.

About Cizzle Bio Inc

Cizzle Bio Inc, a company registered in Texas USA, has been created by a group
of high-net-worth individuals with a passion to improve cancer patient
survival.  Recognising that one of the main causes of poor survival rates for
certain cancers and in particular, lung cancer, is because diagnosis is often
when the disease is at an advanced state, there is an unmet need for a simple
blood test that can be used to detect cancer early. BIO is led by Bill Behnke,
who has been pioneering Cizzle Biotechnology's marketing activities in the USA
and is an accomplished entrepreneur and performance-driven senior executive
with an extensive background of success in funding and building healthcare
businesses through direct sales, marketing, sales management, and business
development.  He is heavily engaged in charitable work for cancer, and served
a nine-year tenure on the national board of the Leukemia and Lymphoma Society.
 He currently serves on the boards of the ASCO Foundation's Conquer Cancer;
the AYA Cancer Foundation; The Wheeler Group; Children's Shelter of San
Antonio; South Texas Blood and Tissue Center; and the Leukemia and Lymphoma
Society.

About CorePath laboratories

Founded and headquartered in San Antonio, Texas as one of the few
international laboratories with the ability to offer immunohistochemistry,
cancer cytogenetics, molecular genetics and multicolour flow cytometry
services at one location.  CorePath brings academic expertise, compassion and
state of the art technology to help physicians help their patients and achieve
the most accurate time-sensitive results for early treatment.

Together, they are a highly specialised team with a shared passion: "Caring
for Lives."

CorePath provides an extensive range of haematopathology services to
healthcare providers across the USA and internationally. They work closely
with the biopharma industry through a seasoned project management team with
relevant scientific and therapeutic expertise in cancer drug study needs.
Their team of board-certified pathologists are subspecialised in different
areas of oncology to precisely diagnose cancers using cutting edge technology.
Customers include ICON, Alexion, Covance, Ventana (Roche) and Becton Dickenson

For more information, please see https://www.corepath.us/

 

 

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